Bafal, Kathmandu
Introduction to management
Case
Study
Submitted to: Submitted
by:
Agnidhar Parajuli Krishna raj kharel
CEO Roll:-07
Department of B.Sc.CSIT 3rd Semester
Internal Environment
An
organization's internal
environment is composed of
the elements within the organization, including current employees, management,
and especially corporate culture, which defines employee behavior. Although
some elements affect the organization as a whole, others affect only the
manager. A manager's philosophical or leadership style directly impacts
employees. Traditional managers give explicit instructions to employees, while
progressive managers empower employees to make many of their own decisions.
Changes in philosophy and/or leadership style are under the control of the
manager. The following sections describe some of the elements that make up the
internal environment.
The best thing about internal
factors is that you can control many of them. Some factors, such as your
business's reputation, image and creditworthiness, are a result of the way you
run your business. Other factors, such as your organization's management
structure and staffing and the physical decor of your business, are based on
your business decisions, and you can change them as you see fit. Changing
internal factors usually involves some indirect costs, such as lost
productivity while new employees are trained, some direct costs, such as a
penalty for terminating a lease before it expires, or some combination of the
two. The internal environment of Nepal telecom are listed below.
Strategy:
After all being
the government organization, strategy in NTC is to reach and retain its
customer more broadly. NTC is trying to install better management software’s to
handle its cross functional areas. With focus on its management NTC are about
to have an Enterprise Resource Planning to improve its management of man,
machine and material to have better satisfied customers.
NTC is also
reducing cost for customer and staying competitive in the market. To counter
the competitors strategy and techniques of attracting customer, NTC, without
lagging behind are working on providing services in lower cost, customer
friendly and new schemes and features.
Employees:
Without forgetting
that the NTC is government organization, for the people working and about to
work in the organization obviously have the presence of prestige and security.
Being the largest profit earning government organization, here the employees
believe that their job is secure and satisfactory.
With the good
sense of security and prestige, NTC is also facing various problems in the
organization. The organization is encountering the hitch of overstaffing and
human resource management. The employees in the organization are not well
updated with the technology and trends in telecommunication. Company cannot
train all of them and also it is hard to fire them. Cost of training to employees
is very much high and it is difficult to recruit the employees in right place.
Though new technologies are emerging in NTC, employees and the management are
quite traditional and persist resistant to change. It is complicated to build
the confidence and change the attitude of employees in the organization for new
technologies and trends.
Shareholders:
Mostly, the
company is owned by government. The very large portion of share is of
government of 91.49%. There is very less amount of shares of general public.
With the good performance of the company, earning per share of NTC is growing
comparing to last year. Therefore the NTC is providing healthy dividend amounts
to its shareholders.
Shareholders
Classification
|
Outstanding
Number of Shares
|
Percentage
|
Government of
Nepal
|
137,239,910
|
91.49%
|
Citizen
Investment trust
|
50,000
|
0.03%
|
Public
|
5,737,905
|
3.83%
|
Employees
|
6,972,185
|
4.65%
|
Total
|
150,000,000
|
100%
|
Unions:
We know that NTC
is the government organization, then without any doubt there is the presence of
influences of unions. The unions present in NTC are Telecommunication Employees
Association of Nepal (TEAN), Nepal Telecom Company Workers Union (NTCWU). There
is high involvement of unions in decision making process in the organization.
Corporate Culture:
Holding the long
history of presence in the industry, culture and management of the organization
is quite traditional. The management culture has the flavor of old taste of
operation and service. Employees are also there for the long time and hold the
traditional nature of dealing to work and customers. Even we can feel the
environment whenever we enter the business house of the organization. Employees
have the mentality of escaping from the task and delaying the services. We can
also find the negligence of executive pertaining to long process and time span
in decision making and implementation.
The External Environment
All outside
factors that may affect an organization make up the external environment . The external environment is divided
into two parts:
·
Directly interactive: This environment has an immediate and
firsthand impact upon the organization. A new competitor entering the market is
an example.
·
Indirectly interactive: This environment has a secondary and
more distant effect upon the organization. New legislation taking effect may
have a great impact. For example, complying with the Americans with
Disabilities Act requires employers to update their facilities to accommodate
those with disabilities.
Directly
interactive forces
Directly
interactive forces
include owners, customers, suppliers, competitors, employees, and employee
unions. Management has a responsibility to each of these groups. Here are some
examples:
·
Owners
·
Customers
·
Suppliers
·
Competitors
·
Employees and
employee unions .
Indirectly
interactive forces
The
second type of external environment is the indirectly
interactive forces. These
forces include sociocultural, political and legal, technological, economic.
a. Political
Analysis
Nepal is in the state of the transition
phase politically. So the political instability seems to be normal during this
phase. All the sectors in the economy are more or less affected by it, and the
telecommunication sector also can’t remain unaffected. The effect is better
seen in NTC because it is a state owned company. The affects can be seen in the
sector of delaying in new projects and investment, and irregularities in the
case of making tender.
The other crucial aspect in political
instability is the change in government. With the change in government, the
first thing that falls under the minister priority is to transfer and allocate
the staffs according to their will and need. This process consequently affects
the plans and procedure of the organization.
b. Economic
Analysis
Although the economy in the world is
shrinking, but the disposable income of the people in Nepal is increasing. The
inflow of remittance in the country is directly helping in this prospect. The
number of people using the cellular mobile phone is increasing day by day.
Furthermore, the inflow of Chinese mobile phones at the low cost is also
helping people to enjoy the services of mobile technology. Hence in Nepal, the
economic environment seems to be favorable.
c. Social
Analysis
Nepal Telecom’s widespread reach will
assist in the socio-economic development of the urban as well as rural areas,
as telecommunications is one of the most important infrastructures required for
development. Accordingly in the era of globalization, it is felt that
milestones and achievements of the past are not adequate enough to catch up
with the global trend in the development of telecommunication sector and the
growth of telecommunication services in the country will be guided by
Technology, Declining equipment prices, market growth due to increase in
standard of life and finally by healthy competition.
d. Technological
Analysis
Technology in the communication sector
is a crucial aspect. New technologies are been developing day by day. Nepal
Telecom is also adopting the new technologies to be updated with the trend. The
new services like ADSL and 3G services are already been used by Nepal Telecom.
Recently NTC completed its optical fiber connection with its sub branches
across Nepal.
e. Legal
Analysis
Nepal Telecommunication Authority is
the governing body for the telecommunication sector. It enacts laws to bind
this sector. With the provision of know your customers, it is bound to
distribute the sim cards to its customers only after the full and detailed
information. It is also restricted to distribute the unlimited number of sim
cards since the frequency is limited to them.
Strength
Those factors or characteristics of the organization that
could serve as the basis for achieving your mission and vision. Examples: good facilities, staff, volunteer
participation, programs, recognition, financial resources, etc. The strength of
Nepal telecom are listed below
·
Economies of scale- It is easier to create economies of
scale thereby increasing return on investment. The Nepali telecom market
especially Kathmandu is a high-density area, which means more population per
tower. This means lower capital expenditure cost.
·
Active management team- Active management is a big strength
to the telecom industry because it is due to the effective management team; the
telecom industry is able to make consistent profit over a long period of time.
·
Manipulate price- NTC has loyal customer base. Eventhough
the comparative prices are higher for its services, customer are ready pay for
it.
·
Strong brand name-Due to the strong brand name of the
company, people have trust and are loyal towards the company. It will not have
any problem in introducing its products and technologies in the new market.
·
Sustainable business modeling-It is able to sustain itself
with the profit it has made over a long period of time even though if there is
some kind of hindrance.
Weaknesses
Factors that realistically may limit the extent or speed
with which your mission and vision may be accomplished. Examples: declining funding, aging and limited
facilities, lack of expertise, etc. the weakness of Nepal telecom are listed
below
·
Low signal strength-Large number of call drops and quality
of connection is not good.
·
Late adoptation of new technology- Nepal is probably one of
the last countries to adopt new technology. Example 3g technology, some
estimate suggests that nearly 133 countries across the world already had
3G technology and mobile services in one form or the other.
·
High overhead cost: NTC is compiled with lagre number of
staffs. NTC is facing hard time to recruit and assign the employees in right
place and in right time.
·
Low quality customer care services-If there is any problem
in the product that you buy, the customer care service in not that efficient to
solve the problem immediately. It will probably take days to cater the
customer. Companies don’t give priority in the maintenance.
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